Listed legal business RBG Holdings has reported grim trading results for the first half of this year, with losses of £5.7m and revenue falling.

The group, which includes law firms Rosenblatt and Memery Crystal, reported to the London Stock Exchange a ‘marked decline’ in activity in May and June, with several key areas of the business affected.

Redundancies were made in the first half and one of the firm’s London sites is to be vacated, as the business tries to bounce back. But the group warned that while it is still optimistic, ‘volatile’ trading conditions mean there is ‘significant uncertainty’ as to whether it will meet market expectations for 2024.

The interim results had an immediate effect on the group’s share price, which dropped by 41% on Monday morning to 3.5p. Shares in the company were worth 22.5p a year ago.

Jon Divers, chief executive of RBG Holdings plc, said: ‘There have been some challenging times during the first six months of 2024. Trading from January to April was robust and in-line with our expectations, however, the announcement of a general election had a marked impact on all areas of the business. The summer is traditionally a quieter period, but I am pleased with the activity levels in September.’

During the first six months of the year the company made a number of cost-cutting moves. It disposed of subsidiary Convex Capital for £2.6m and has saved around £4.5m by surrendering the lease on its St Andrew Street property, which accounted for 40% of the group’s annual property costs.

RBG confirmed there had also been a ‘targeted headcount’ cut, with the average number of employees across the business reducing from 201 to 192. This was the result of a redundancy exercise in the first half of 2024 which cost around £600,000.

The company said: ‘During previous periods of strong revenue growth and high business activity, the group increased its headcount to meet demand. However, as business levels normalised, it became apparent that the form was carrying more staff than necessary for the available workload. Consequently, the group made the difficult decision to reduce headcount to better align with its operational needs.’

Revenue fell by 6.8% to £18.4m, with net debt increasing from £21m to more than £24m.

RBG said reducing lock-up days is an area of ‘intense focus’ for management, reporting that this figure had fallen during the year from 152 to 125.

Chief financial officer Kevin McNair added: ‘The simplification of the group’s operations following the disposals of all non-core activities means we are now a pure legal services business and our focus going forward will be to optimise the performance of these activities.

‘The subdued market conditions of the past 18 months have held back topline growth in legal services but there are encouraging signs that these will improve in Q4 2024 and going into 2025.’

 

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